The 3 Components of Infinite Banking Policy Design: Base, PUAs, and Term

Bruce Wehner discusses the primary components of infinite banking policy design: base premium, paid-up additions riders, and term riders. Following the principles laid out by Nelson Nash in Becoming Your Own Banker, we review the concepts for designing a whole life insurance policy for the Infinite Banking Concept. https://www.youtube.com/watch?v=S54uejv8g-Q When Bruce’s father took out a whole life insurance policy on him as a newborn, little did he know that it would be the cornerstone of Bruce’s financial planning in the future. From leveraging that policy for a home down payment to understanding the value of banking, I’ve followed the policy design guidelines of the Nelson Nash Institute to navigate the complex world of finance. Join us in our exploration of whole life insurance and the myriad of benefits it offers not just from a security standpoint, but also as a tool for capital growth and liquidity. In this episode, we touch upon: The long-term thinking involved in whole life insurance policy design.  The three building blocks that make up a solid policy for IBC  - and how to mix them just right for your situation The nitty-gritty of policy design, discussing why a convertible term policy can be a boon for your financial portfolio. We illuminate the often misunderstood relationship between banking and insurance that most financial advisors never talk about We examine the financial intricacies of policy design, emphasizing the importance of understanding the connection between a policy’s base death benefit and premium.  We share insights into how dividends are calculated and how factors such as a low-interest-rate environment can impact these projections. Wrapping up, we stress on the importance of affording the premiums and how it affects the potential dividends one can receive. So, tune in, and let’s debunk the myths surrounding whole life insurance policy design while learning how to make the most of it. Whole Life Insurance is Not an InvestmentThe 3 Components of Infinite Banking Policy DesignWhat is Base?What are PUAs?Infinite Banking Policy Design and Base/PUA SplitInfinite Banking Policy ExampleThe Role of Term InsuranceThe Balance of Infinite Banking Policy DesignLiquidity and Thinking Long-TermOther Facets of Infinite Banking Policy DesignBecoming Your Own Banker: The Power of Purposeful Policy DesignFrequently Asked Questions About Infinite Banking Policy DesignHow long until my cash value exceeds my total premiums paid?Is an IBC policy only for wealthy individuals?Can I add more money to my policy later?Book A Strategy Call Whole Life Insurance is Not an Investment Whole life insurance is a unique place to store cash because it’s safe and it grows. This growth, however, cannot be compared to investments because it’s not an investment. Instead, it should be compared to a bank, which is meant to be “safe” growth. This comparison reveals that cash value in a policy grows at a more substantial rate and is also tax-advantaged. Cash value is also fairly liquid, though it takes some time for your cash value to catch up to the contributions you make. In other words, there are some limitations on the liquidity early on. However, this is temporary and is more than worth the trade-off of safe growth — safe from the IRS, creditors, taxation, loss, theft, and death. It’s an iron-clad way to store your cash that you can’t get anywhere else. The 3 Components of Infinite Banking Policy Design In order to get the best results from your whole life insurance policy, you want one that is specifically designed for IBC. This means that you want to work with an insurance agent who is familiar with your financial objectives and can help you choose the ideal policy design. Policy design can be complex, yet the three main components of a policy are base premium, PUA riders, and term riders. What is Base? Base refers to the part of your premium that goe...